Category: From Alliance for American Manufacturing

Trump Budget Would Slash Funding for Manufacturing Extension Partnerships

Elizabeth Brotherton-Bunch

Elizabeth Brotherton-Bunch Digital Media Director, Alliance for American Manufacturing

It seems like a thousand news cycles ago now, but President Trump unveiled his proposed 2020 budget on Monday.

The $4.75 trillion budget includes major cuts to federal spending for domestic programs while increasing funding for defense and border security. Lots of people are fired up about it, but it’s important to keep in mind that Congress has the ultimate say over the budget — and lawmakers have rejected many of Trump’s budget requests in the past.

Still, the budget does offer a glimpse into the Trump administration’s priorities for the upcoming year, and as such we spent some time digging through the document for items that may impact manufacturing. One thing in particular caught our eye: Trump’s proposal to severely cut — and eventually phase out — federal funding for the Manufacturing Extension Partnership (MEP) program.

This is a terrible idea. Just terrible.

MEP runs a network of centers in all 50 states and Puerto Rico designed to help small and medium-sized manufacturers improve their businesses, including through things like product development, worker training programs, and business continuity planning.

MEP punches above its weight when it comes to achieving results. The $128 million invested in MEP during fiscal year 2017 generated almost $1.9 billion in returns to the federal treasury, according to a study by the Upjohn Institute.

Meanwhile, MEP has helped create 985,117 jobs since its founding in 1988. That’s nearly a million jobs!

That’s not all, either. When MEP celebrated its 30th anniversary last year, it noted it has worked with 94,033 manufacturers, helping generate $111.3 billion in sales and $18.8 billion in cost savings for its clients.

That is why it strikes us as foolhardy for the Trump administration to try to gut the program. Trump proposes cutting current funding levels by $125 million for fiscal 2019 — which would leave just $5 million left for the program. Eventually, the federal government would cut off all funding, according to the proposal.

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Lumber Liquidators Agrees to $33 Million Penalty for Dangerous Made in China Flooring

Elizabeth Brotherton-Bunch

Elizabeth Brotherton-Bunch Digital Media Director, Alliance for American Manufacturing

You might remember that back in 2015, the television news program 60 Minutes aired an investigative report finding that national chain Lumber Liquidators was selling Made in China laminate flooring containing dangerously high levels of formaldehyde, a substance known to cause cancer.

The segment – if you feel like getting angry today, just watch it below –  prompted the government to investigate, and a class action lawsuit was filed on behalf of the 760,000 customers who had purchased the poisonous flooring.

In 2018, Lumber Liquidators was ordered to pay a $36 million settlement as a result of the class action lawsuit. And on Tuesday, the company agreed to pay a $33 million penalty to settle federal charges that it misled its investors about the flooring. Reuters reports:

The Justice Department settlement includes a deferred prosecution agreement, under which the government agreed not to prosecute Lumber Liquidators for securities fraud so long as the company upgrades oversight and cooperates with its ongoing probe for three years. … The amount the company will pay represents Lumber Liquidator’s net profits from the sale of 100 percent of its Chinese laminate from January through May 2015, U.S Attorney’s office said.

The company also has completely replaced its senior executive team, and “installed experienced executives who have displayed a commitment to building an ethical corporate culture,” according to U.S. Attorney G. Zachary Terwilliger.

As 60 Minutes reported, the Chinese-made laminate flooring sold by Lumber Liquidators contained astonishingly high levels of formaldehyde. When a team of investigators featured in the report tested 150 boxes of the flooring, they found every single piece of it exceeded California emissions standards, some 20 times above acceptable levels. A 2016 federal investigation confirmed much of those findings.

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Are February’s Disappointing Jobs Numbers the Start of a New Trend or Just a Blip?

Elizabeth Brotherton-Bunch

Elizabeth Brotherton-Bunch Digital Media Director, Alliance for American Manufacturing

The Labor Department released its monthly jobs report on Friday, and it was a… good one? Bad one? O.K. one?

Manufacturing gained 4,000 new jobs in February, while 20,000 new jobs were created across the economy. That was well below expectations of around 180,000 new jobs.

Over at the White House, President Trump shrugged off the report, and some economists also said they weren’t all that concerned. After all, wages are on the rise, suggesting things are still strong. Unemployment rates for workers who didn’t graduate high school fell 5.3 percent, a sign that the economy is still doing just fine.

Meanwhile, the weather was pretty brutal across the country in February, which probably slowed hiring down quite a bit.

But not everybody is so confident. After all, 20,000 jobs isn’t great, especially when you consider that factory jobs alone had grown by an average of 22,000 new jobs per month over the past 12 months.

“This is a disappointing report. I don’t think there’s any way to sugarcoat it,” Carl Tannenbaum, chief economist of Northern Trust in Chicago, told the New York Times.

So who has it right?

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John Oliver’s Segment on Jobs and Automation Doesn’t Quite Get It Right

Riley Ohlson

Riley Ohlson Vice President of Federal Gov't Affairs, AAM

John Oliver tackles some wonky issues on his HBO show, Last Week Tonight. Sunday’s episode was no exception, as he examined a topic very dear to our hearts: Automation.

And Oliver’s bit certainly garnered a lot of attention, with more than 4.3 million views on the show’s YouTube channel alone. But unfortunately, Oliver didn’t quite get it right — and given the host’s incredible reach, it’s important we clarify a few things (even if my seven Twitter followers don’t have quite the same reach of Oliver).

Oliver began by poking fun at President Trump's bluster about stolen jobs during the 2016 presidential campaign. After a begrudging admission that “some” manufacturing job loss is due to trade, Oliver quickly pivoted to automation, the phenomenon whereby industrial robots and other equipment take over parts of the production process that used to be done by humans.

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Latest Manufacturing Numbers Could Be Trend or Blip: AAM Statement

The U.S. manufacturing sector experienced minimal gains in February, posting only 4,000 new jobs. Over the past year, the sector saw average increases of 22,000 new jobs per month.

Alliance for American Manufacturing President Scott Paul said:

“Manufacturing barely continued a positive run of job gains in February. While it’s too early to tell whether this is a trend or a blip, there are policies that can boost factory jobs. Infrastructure investment, which has broad, bipartisan appeal, would be a good start.

“The trade deficit with China may also be dampening the full potential of American manufacturing. This makes a tough, enforceable deal with China even more important. We urge the administration not to settle for the sake of expediency.”



As Lordstown GM’s Last Car Rolls Off the Line, 1,400 Jobs Disappear

Cathalijne Adams

Cathalijne Adams Writer/Researcher, AAM

General Motors’ (GM) Lordstown Township plant’s first car, a Chevrolet Impala, cruised onto the road on April 28, 1966, and decades of work at the plant followed. But on Wednesday, the plant’s last car rolled off the assembly line, 1,400 jobs came to an end, and entire community suffers in their wake.

One of five GM plants that will be idled, Lordstown shut down production. Though 700 Lordstown workers have transferred to other GM plants, many are unable to uproot their families and have been left to search for new employment.

For GM executives like CEO Mary Bara, the closure of plants like Lordstown represents a shifting of gears to accommodate emerging automotive trends. But the human toll of the decision to unallocate plants is very real.

When family-supporting manufacturing jobs leave a town, few workers, particularly those without a college degree, can find employment that can replace these valuable jobs, as this Washington Post article illustrates.

GM production workers can earn between $61,000 and $88,000 annually. In stark contrast, the average salary in the area surrounding the Lordstown plant was only $38,000 in 2017.

With few employment options left in Lordstown, some workers are holding out hope that United Automobile Workers’ (UAW) labor contract negotiations with GM this fall will bring new production to the Lordstown plant. (UAW is currently also in the process of suing GM for stopping production at three plants before labor contracts expired.)

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A brief, 90-year history of Republicans calling Democrats ‘socialists’

So, this happened.

This is not the first time, and it won’t be the last, that the Republican Party tried to associate its opponents with socialism — the belief that the government should take control of the means of production. President Donald Trump used his recent State of the Union address to claim that “here, in the United States, we are alarmed by new calls to adopt socialism in our country.” Vice President Mike Pence told the Conservative Political Action Conference last weekend that “America will never be a socialist country.” Senate Majority Leader Mitch McConnell, in an opinion piece that could win Pulitzer Prize for its outstanding contribution to the field of false choices, writes that America “needs strong borders — not socialism.”

To be fair, the lines between “socialism” and other forms of government are often blurred. Sen. Bernie Sanders (I-VT), for example, sometimes describes himself as a “socialist,” despite the fact that he does not advocate public ownership of the entire productive sector.

Nevertheless, the GOP has a long history of making facile comparisons between ordinary Democratic policy proposals and “socialism” — a history that predates Sanders by generations. Indeed, the socialism smear even predates our modern-day political coalitions, with the Republican Party commonly understood as the economically conservative party and the Democrats as economic moderates and liberals.

The socialism smear shaped the modern GOP. The idea built its coalition, defined many of its objections to the Democratic alternative, and helped form the partisan divide that is so familiar today. The socialism smear targeted the New Deal. It was Ronald Reagan’s weapon against Medicare, Newt Gingrich’s weapon against “Hillarycare,” and the entire GOP’s weapon against Obamacare.

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A Year Later, Section 232 Trade Action Continues to Fortify Steel and Aluminum Industries

Cathalijne Adams

Cathalijne Adams Researcher, AAM

One year after President Donald Trump’s announcement that he would issue a 25 percent tariff on steel imports and 10 percent on aluminum imports in response to an investigation into the national security threat posed by steel and aluminum dumping, the positive impacts of the Section 232 trade action continue to bloom.

Remember that before this, steel and aluminum workers grappled with a market flooded with cheap steel and aluminum, largely from China, which produced nearly as much steel in a month as the U.S. did in a year.

For the steel and aluminum workers who attended Trump’s signing of the Section 232 tariff proclamation on March 8, 2018, the event signaled the opening of a new, hopeful chapter for them and their peers.  

But these men and women are not alone in their relief, workers nationwide have seen the benefits of the steel and aluminum industries’ renewed vigor. Just take a look at the most recent mill restarts in Lone Star, Texas, and Fairfield, Ala., or other manufacturers stimulated by increased operations in America’s steel and aluminum mills. Indeed, the U.S. manufacturing industry is finding renewed strength, and more Americans are back at work.

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Is a U.S.-China Trade Deal Imminent, Or Does ‘Much Still Need to Be Done’?

Cathalijne Adams

Cathalijne Adams Researcher/Writer, AAM

The terms of a U.S.-China trade deal have been handed off to President Xi Jinping for consideration with a signing summit likely in “late March,” said White House Economic Adviser Larry Kudlow on CNBC Thursday. However, United States Trade Representative Robert Lighthizer testified before the House Ways & Means Committee Wednesday that “much still needs to be done” before a U.S.-China trade agreement can be reached.  

Though both members of Trump’s trade team praised U.S.-China negotiations as having already achieved great progress in advancing structural changes in Chinese trade practices, Kudlow’s comments indicate that the heavy lifting for the trade deal is complete.

“The Chinese side has to come back and agree. I believe they will, and I believe there will be a meeting in late March down in Mar-a-Lago, but we have to wait for their decision,” said Kudlow. “We’ve never ever come this far with China trade, and, again, the outlook for a deal is very positive.”

During his appearance on CNBC, Kudlow also addressed alleged tension between Lighthizer and President Donald Trump, calling rumors that the president and his lead negotiator for U.S.-China trade talks are not in sync “just untrue.”

Trump’s decision to cancel a March 1 tariff increase on Chinese imports and his optimistic tweets regarding trade talks may signal that he is willing to accept a weaker trade deal than Lighthizer, a consummate China trade hawk.

Should Trump prioritize a quick and easy deal focused on increasing U.S. exports to China over meaningful structural changes, there would indeed be cause for strife between the president and Lighthizer – and cause for great disappointment in this negotiation process as a whole.


Reposted from AAM

Want to See the Section 232 Tariffs in Action? Look Here.

Jeffrey Bonior

Jeffrey Bonior Writer/Researcher, AAM

When President Donald Trump implemented the Section 232 tariffs to protect an American steel industry weakened by the global overcapacity crisis, there were doubts about what effect the tariffs would have on stopping the flood of foreign steel into the United States.

It is nearly a year later, and positive results are slowly trickling in. That’s good news for an industry so important to our defense industrial base.

It is estimated that approximately 11,000 steelworker jobs have been returned to America’s economy. Idled mills have restarted production and new mills are being built.

Unexpectedly, two Oil Country Tubular Goods (OCTG) mills in recent weeks have benefitted as U.S. Steel, which was struggling with its tubular production, announced increased production and the hiring of additional workers.

At the OCTG pipe mill in Fairfield, Alabama things looked so bleak it appeared the entire mill would shut down. The rolled steel portion of the mill had been idle with the plant relying on its tubular production.

“The tube mill is operating; we slowed down but never shut down,” said United Steelworker Local 1015 President Kevin Key, “The steel-making facilities and the blast caster were shut down.”

There are currently about 600 workers in the pipe mill, and U.S. Steel plans another 150 workers in the coming months.

Key feels President Trump’s tariffs have had a positive effect.

“I think they helped,” said Key. “The numbers, especially in the last quarter of the year, which is usually a bad time for a lot of people, November and December are usually our slow months. But this year October, November and December we were up.

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New NAFTA Must Create an Economy for All

New NAFTA Must Create an Economy for All

Union Matters

Support the Equality Act

From the AFL-CIO

Rep. David Cicilline and Sen. Jeff Merkley last week reintroduced the Equality Act in the 116th Congress. A landmark piece of civil rights legislation, the bill would extend comprehensive protections to LGBTQ working people.

Currently, private employers in 29 states can legally fire workers based solely on their sexual orientation or gender identity.

The Equality Act would ensure that civil rights protections are extended equally to LGBTQ Americans.

Amending existing federal civil rights laws, it would explicitly prohibit discrimination on the basis of sexual orientation and gender identity in education, employment, housing, credit, federal jury service, public accommodations and the use of federal funds.

More than 70% of Americans—including a majority of Republicans—support passing the kinds of protections found in the Equality Act.

The Equality Act’s record number of co-sponsors in the House of Representatives is 239.

 “No one’s civil rights should depend on the ZIP code they happen to be in at the moment.” —Pride At Work Executive Director Jerame Davis

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